Fifth Third Bancorp has reached a deal to acquire a financial technology company specializing in handling lending and banking for health care providers.
Cincinnati-based Fifth Third (Nasdaq: FITB), the ninth-largest U.S.-based consumer bank, signed a definitive agreement to acquire San Francisco-based Provide, which has developed digital products that enable health care practices to get loans, establish bank accounts and access payment services.
Fifth Third was already familiar with Provide. It first invested in Provide, then known as Lendeavor, in 2018. Fifth Third later took part in a $34 million equity financing round the company raised in December, when it changed its name to Provide. Fifth Third also began funding loans through Provide’s platform last year.
The acquisition will increase its national digital capabilities.
"The health care industry is one of the largest and fastest growing segments of the U.S. economy,” Fifth Third CEO Greg Carmichael said in a release. “Over the last decade, Fifth Third’s healthcare team has expanded its presence and expertise to become one of the top health care banking platforms for middle-market and corporate client.”
Fifth Third’s planned acquisition of Provide will enable it to help health care providers “focus on what they do best – providing the care their patients need while we make their banking experience convenient and efficient,” Carmichael said.
Provide will keep its brand name after the acquisition and operate as an independent business line. The company, founded in 2013 by Daniel Titcomb and James Bachmeier III, has originated more than $1 billion in loans. It has also used its partnership with Fifth Third to provide banking and payments services to more than 70% of the doctors for whom it provides acquisition financing.
Titcomb and Bachmeier said in the release they expect Provide to be able to grow as a result of its partnership with Fifth Third.
Fifth Third has been active in teaming with or acquiring fintech companies in recent years. It partnered with Reston, Va.-based Fundation Group last year to make it faster and easier for small businesses to get loans.
It has invested more than $100 million in deals with companies such as savings account app Dobot, and GreenSky, the Atlanta-based company that helps consumers get loans for home improvement projects.
Fifth Third CEO Greg Carmichael has a tech background and has told me numerous times since taking over that role in 2015 that he's focused on increasing Fifth Third's technology capabilities.
